The fundamental principles of cooperative operation are inherently in conflict with the traditional concept of an IPO.

James H. Smith and Howard Stone

1.Subordination of capital. Neither interest nor dividends may be paid on invested capital. Cooperatives provide for a return of capital-not a return on capital. Furthermore, neither the amount of patronage nor the amount of investment of a patron can determine such patron's degree of ownership or control of the organization, i.e., there must be patronage-based ownership.

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